1.1Business Ethics and the Changing Environment
1.2WHAT IS BUSINESS ETHICS? WHY DOES IT MATTER?
1.3LEVELS OF BUSINESS ETHICS
1.4FIVE MYTHS ABOUT BUSINESS ETHICS
1.5WHY USE ETHICAL REASONING IN BUSINESS?
1.6CAN BUSINESS ETHICS BE TAUGHT AND TRAINED?
1.7PLAN OF THE BOOK

|lecture outline |

1.1Business Ethics and the Changing Environment

Businesses and governments operate in changing technological, legal, economic, social, and political environments with competing stakeholders and power claims. Stakeholders are individuals, companies, groups, and nations that cause and respond to external issues, opportunities, and threats. Disruptive technologies, increased working hours, increased personal and professional stress create pressure on stakeholders. Examples include: Enron, Adelphia, and others; excessive CEO pay and poor corporate performance; new regulation (eg., Sarbanes-Oxley Act of 2002); and increased outsourcing.

A.Seeing the “Big Picture”

1.Thomas Friedman has written a vivid account of the accelerating trendtoward globalization in The Lexus and the Olive Tree.

B.Environmental Forces and Stakeholders

1.Organizations are embedded in and interact with multiple changing local,national, and international environments.

2.The economic environment continues to evolve into a more global context oftrade, markets, and resource flows.

3.Technologically, the advent of electronic communication and the Internet ischanging economies, industries, companies, jobs, and the way business isconducted.

4.Politically, the fall of communist regimes and the rise of global terrorism arealso changing trading and business partners.

5.Governmental and regulatory laws and procedures also are changing.

6.Legal questions and issues affect all of the environmental dimensions and everystakeholder.

7.Demographically, the workforce has become more diverse.

C.Stakeholder Management Approach

1. The stakeholder management approach is a way of understanding the ethical effects of environmental forces and groups on specific issues that affect real-time stakeholders and their welfare.

2. Begins by enabling win-win strategies based on:

a. identifying and prioritizing issues, threats, or opportunities.

b. mapping who the stakeholders are.

c. identifying their stakes, interests, and power sources.

d. showing who the members of coalitions are or may become.

e. showing what each stakeholder’s ethics are (and should be).

f. developing collaborative strategies and dialogue from a “higher ground” perspective to move plans and interactions to the desired closure for all parties.

1.2WHAT IS BUSINESS ETHICS? WHY DOES IT MATTER?

Ethical “solutions” to business and organizational problems may have more than one alternative and sometimes no right solution may seem available. Learning to think, reason, and act ethically can enable us to be aware of and recognize a potential ethical problem. Laura Nash defined business ethics as “the study of how personal moral norms apply to the activities and goals of commercial enterprise.” Nash stated that business ethics deal with three basic areas of managerial decision making that include: choices about what the laws should be and whether to follow them; choices about economic and social issues outside the domain of law; and choices about the priority of self-interest over the company’s interests.

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hierarchy
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profits
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rules
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products
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places
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objectives
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profits
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levels
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A.
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B.
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C.
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1a) BusinessEthics is a professional ethics that examining ethical principles and moral or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and entire organizations.
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1) Internationalbusiness
2) Health and safety
3) Protection and proper use of company asset
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6) Conflict of interest
7) Equal employment opportunity
8) Anti-Harassment and sexual harassment
9) Political Payments
10) Proprietary Data
11) Insider information and securities trading
12) Antitrust or competition laws
13) Accounting systems, books and records
14) Coercion of auditors
15) Public disclosure and financial reporting
16) Employment of current or former government employees
17) Gifts
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Development of businessethics
Before 1960’s:
-Questioning capitalism
-“living wage” income
-New Deal-blaming business for economic woes
-Individual moral issues related to business were addressed in churches. Religious leaders questioned labor wages and morality of capitalism
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The 1960’s:
-Military industrial complex
-Growth of ecological problems(pollution, toxic waste)
-Turned to causes, emergence of social issues, rise in consumerism
-Pres Kennedy consumers’ bill of rights (right to safety, to be informed, to choose and to be heard)
Delivered special message on protecting the consumer interest
-Nader’s unsafe at any speed criticizing automobile industry(safety belts)
-Pres Johnson and Great Society (told business community the us govts. Responsibility was to provide the citizen with some degree of economic stability,...

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